Telematics-based car insurance is here to stay, says the Institute of Advanced Motoring

Telematics-based car insurance (using so-called "black boxes" that record driving data) could become the norm for young drivers, according to the Institute of Advanced Motoring (IAM).

Neil Greig, IAM director of policy, said: "In a couple of years young drivers may not be able to get insured without a black box."

A range of telematics-based insurance policies is now available for young drivers. A simple black box is fitted to the car, and it uses a combination of GPS and motion sensors to detect hard acceleration, braking and speed limit infringements.

Depending on insurance provider, the policies aim to reduce claims by providing incentives or lower premiums to good drivers, with the threat of increased premiums for those that don't meet certain standards.

The IAM has teamed up with insurance firm RK Harrison to launch a new policy that combines a half-day IAM training course with an in-car telematics system, as part of an overall family insurance package.

Greig said that the IAM's involvement represented its first chance to work with telematics, and that he expected their use would increase in the future.

As well as potentially lowering insurance premiums for drivers, black boxes could be used to improve road safety by highlighting a driver's bad habits, he suggested.

"Black boxes can record a vast amount of information. Our ultimate use of a black box is to inform a tailored training solution," he said.

Improving road safety for young drivers should be a priority, he added. Statistics show that drivers aged 17-24 are the most likely to crash and in March this year the Government announced a range of proposals as part of a green paper on improving road safety for young drivers that will be published in June.

Katie Small, board director at RK Harrison, said: "Drivers aged 17-24 are the biggest problem for the [insurance] industry, because their safety record is so bad."

"[Our new policy] gives drivers the skills to improve. Telematics on their own won't solve the problem. The IAM course gives drivers the skills to improve, and monthly reports allows parents to monitor their child's progress."